In a forward rate agreement, the settlement amount is determined by the difference between the benchmark rate and the guaranteed rate.

Name: In a forward rate agreement, the settlement amount is determined by the difference between the benchmark rate and the guaranteed rate.
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Quizplus · Accepted Answer

In a forward rate agreement, the settlement amount is calculated based on the difference between the agreed-upon guaranteed rate and the actual benchmark rate at the time of settlement.

In a Forward Rate Agreement, the Settlement Amount Is Determined